Air NZ needs niche within Australia
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Air NZ needs niche within Australia
Thurs "The Dominion Post" NZ
Air NZ needs niche within Australia
11 September 2003
By ROELAND VAN DEN BERGH
Air New Zealand must set up a domestic airline in Australia to survive without a Qantas alliance, Centre for Asia Pacific Aviation Studies analyst Ian Thomas said yesterday.
If the alliance's defeat this week at the hands of Australia's consumer watchdog was not overturned on appeal, Air New Zealand would have to establish an Australian network – either on its own or with another partner, he said. It would need to raise about $300 million to set up a network that would focus on the key routes.
Mr Thomas said a code share arrangement with either Qantas or Virgin Blue was probably not practical. Qantas would be a direct competitor and Virgin Blue's operations and products were too different.
Air New Zealand was well placed to expand into the Australian domestic market because it already flew across the Tasman and had a profitable home base, he said. Its brand also had market awareness in Australia. "Providing domestic links is really an extension, rather than establishment of a new operation," he said.
Air New Zealand could also use its beyond rights to fly into Asia through Australia. "For all intents and purposes, it can become an Australasian airline in its own right rather than having to depend on Qantas."
Air New Zealand would also be supported by its StarAlliance partners, which had not been represented in Australia since the demise of Ansett Australia in 2001. "I don't think Air New Zealand can operate viably in the long term without a strong direct Australian presence," Mr Thomas said. "It is just a matter of whether the funds can be found in an acceptable manner to make it work."
Mr Thomas predicted fares to Australia would fall in coming months.
Qantas is expected to announce a new fare structure next week for trans-Tasman routes, according to industry sources. The new structure is aimed at matching Air New Zealand's Tasman Express fares which start on October 29 and have reduced ticket prices by up to 45 per cent.
Qantas has set up a New Zealand entity, Jetconnect, with a lower cost base, to run its trans-Tasman flights out of Wellington and Christchurch.
Mr Thomas said there would be over-capacity on Tasman routes in coming months with the arrival of Dubai-based Emirates Airline and increased competition between Qantas and Air New Zealand. "Over-capacity leads to one thing, and that is deep price-cutting," he said.
But Travel Agents Association president James Langton said if Air New Zealand and Qantas believed their alliance would eventually be cleared it was unlikely they would have "a war of attrition".
Even if the alliance failed on appeal, it was unlikely the two airlines would try to destroy each other. They would continue to compete "as they have done for many years", he said.
The arrival of Virgin Blue would reduce prices, but Mr Langton did not expect Virgin to be here before Christmas.
=========================================
Thurs "The Dominion Post" NZ
Origin cans flights after rival matches move
11 September 2003
Origin Pacific has accused Air New Zealand of "blatant misuse of its dominant position" after the national carrier said this week it would match Origin Pacific's new Hamilton-Christchurch service.
Origin Pacific said it had reluctantly re-evaluated its proposed flights and concluded the service could not survive while being "dumped on" by Air New Zealand's service at exactly the same times and on the same days.
Three weeks ago, Origin Pacific issued its expanded summer schedule featuring new routes and 10,000 extra seats a month.
It included the new non-stop service between Hamilton and Christchurch.
This week, Air New Zealand said it would also start a Hamilton-Christchurch service, leaving Hamilton at the same time and starting on the same day.
"Is it a coincidence? Only if you believe in the tooth fairy and flying pigs," Origin Pacific chief executive Robert Inglis said. "It's quite deliberate – a strategy to exercise a dominant market position."
However, Air New Zealand strongly denied Origin Pacific's claims, saying it had been examining a Hamilton-Christchurch service for the past two years.
It had planned to announce the service two weeks ago, but delayed it to coincide with the Tourism Industry Association conference in Queenstown this week, Air New Zealand senior vice-president Norm Thompson said.
It was "nonsense" to suggest the move was anti-competitive
============================================
Air NZ needs niche within Australia
11 September 2003
By ROELAND VAN DEN BERGH
Air New Zealand must set up a domestic airline in Australia to survive without a Qantas alliance, Centre for Asia Pacific Aviation Studies analyst Ian Thomas said yesterday.
If the alliance's defeat this week at the hands of Australia's consumer watchdog was not overturned on appeal, Air New Zealand would have to establish an Australian network – either on its own or with another partner, he said. It would need to raise about $300 million to set up a network that would focus on the key routes.
Mr Thomas said a code share arrangement with either Qantas or Virgin Blue was probably not practical. Qantas would be a direct competitor and Virgin Blue's operations and products were too different.
Air New Zealand was well placed to expand into the Australian domestic market because it already flew across the Tasman and had a profitable home base, he said. Its brand also had market awareness in Australia. "Providing domestic links is really an extension, rather than establishment of a new operation," he said.
Air New Zealand could also use its beyond rights to fly into Asia through Australia. "For all intents and purposes, it can become an Australasian airline in its own right rather than having to depend on Qantas."
Air New Zealand would also be supported by its StarAlliance partners, which had not been represented in Australia since the demise of Ansett Australia in 2001. "I don't think Air New Zealand can operate viably in the long term without a strong direct Australian presence," Mr Thomas said. "It is just a matter of whether the funds can be found in an acceptable manner to make it work."
Mr Thomas predicted fares to Australia would fall in coming months.
Qantas is expected to announce a new fare structure next week for trans-Tasman routes, according to industry sources. The new structure is aimed at matching Air New Zealand's Tasman Express fares which start on October 29 and have reduced ticket prices by up to 45 per cent.
Qantas has set up a New Zealand entity, Jetconnect, with a lower cost base, to run its trans-Tasman flights out of Wellington and Christchurch.
Mr Thomas said there would be over-capacity on Tasman routes in coming months with the arrival of Dubai-based Emirates Airline and increased competition between Qantas and Air New Zealand. "Over-capacity leads to one thing, and that is deep price-cutting," he said.
But Travel Agents Association president James Langton said if Air New Zealand and Qantas believed their alliance would eventually be cleared it was unlikely they would have "a war of attrition".
Even if the alliance failed on appeal, it was unlikely the two airlines would try to destroy each other. They would continue to compete "as they have done for many years", he said.
The arrival of Virgin Blue would reduce prices, but Mr Langton did not expect Virgin to be here before Christmas.
=========================================
Thurs "The Dominion Post" NZ
Origin cans flights after rival matches move
11 September 2003
Origin Pacific has accused Air New Zealand of "blatant misuse of its dominant position" after the national carrier said this week it would match Origin Pacific's new Hamilton-Christchurch service.
Origin Pacific said it had reluctantly re-evaluated its proposed flights and concluded the service could not survive while being "dumped on" by Air New Zealand's service at exactly the same times and on the same days.
Three weeks ago, Origin Pacific issued its expanded summer schedule featuring new routes and 10,000 extra seats a month.
It included the new non-stop service between Hamilton and Christchurch.
This week, Air New Zealand said it would also start a Hamilton-Christchurch service, leaving Hamilton at the same time and starting on the same day.
"Is it a coincidence? Only if you believe in the tooth fairy and flying pigs," Origin Pacific chief executive Robert Inglis said. "It's quite deliberate – a strategy to exercise a dominant market position."
However, Air New Zealand strongly denied Origin Pacific's claims, saying it had been examining a Hamilton-Christchurch service for the past two years.
It had planned to announce the service two weeks ago, but delayed it to coincide with the Tourism Industry Association conference in Queenstown this week, Air New Zealand senior vice-president Norm Thompson said.
It was "nonsense" to suggest the move was anti-competitive
============================================
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ANZ should stop blaming and bludging off everyone else and making piss poor excuses for being nothing more than a financial basket case. Don't come to Oz and look for a saviour. SQ wanted to help but they weren't interested. ANZ like the Kiwi is just a little bird that can't fly. They should just face the inevitable and cease operating.
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HOODOOGURU - I suggest you make a nice cup of tea, have some more of the pink tablets the doctor gave you, and have a lie down until bad men in your head go away. It is AUSTRALIAN aviation analysts who are suggested that ANZ could/should seek again to enter the Aust domestic market - just as QF has done in NZ - ANZ has not made any suggestion to this effect. The same Aust analysts have noted that since it's near demise, ANZ has turned 42% of the QF profit on 38% of the revenue, has a =/- 2c per km better operating profit than QF, and has lower operating costs - in fact, is quite a profitable entity - this being one of the reasons for the ACCC's turning down the application - ie, ANZ is in good financial shape - read the ACCC report.... while you have that lie down, there's a good chap.
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Can't understand why you Kiwis get upset when anyone bags your national carrier. And there's my point.... most of the criticism is towards Air NZ not you kiwis as individuals.
Your national carrier IS a basket case because of inept management. A contributor above suggests that 300 million is a lot to get started in OZ. I think 1.3 billion is more like the figure. Thats 1 billion for what they pi$$ed up agaist the wall at the end of 2001 and the 300 mil. they want to spend now. If I was an Air NZ shareholder (and I'm not) I'd be very nervous about now.
Time our corprate governors not only woke up to smell the roses but are somehow held accountable for some of the very very poor decisions made in the boardroom. If I made a bad decision which resulted in a failure (accident or incident) I have no doubt that there would be headlines of "pilot error". Why don't we ever see headlines of "managing director's error".
Anyhoo.... back to the sideline for me.
Your national carrier IS a basket case because of inept management. A contributor above suggests that 300 million is a lot to get started in OZ. I think 1.3 billion is more like the figure. Thats 1 billion for what they pi$$ed up agaist the wall at the end of 2001 and the 300 mil. they want to spend now. If I was an Air NZ shareholder (and I'm not) I'd be very nervous about now.
Time our corprate governors not only woke up to smell the roses but are somehow held accountable for some of the very very poor decisions made in the boardroom. If I made a bad decision which resulted in a failure (accident or incident) I have no doubt that there would be headlines of "pilot error". Why don't we ever see headlines of "managing director's error".
Anyhoo.... back to the sideline for me.
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Clive that criticism would be more accurately directed at the Labour government, and if you Aussies want to bag them,go right ahead.
Clive(& Hoodoo),the national carrier WAS a financial basket case because of inept management (they were susequently dismissed,presumably under "MD error").
As pointed out, the profit turned by Air NZ compares favourably with that of Qantas given relative size/revenue.Given the recent turn-around,perhaps you could drop the present tense.
YES, Ansett was a poor purchase at the time - plenty written already about due dilligence(sp?). The fact is Ansett,as it was was doomed(see previous post) long before Air NZ turned up,they were just dumb enough to buy it .Bad decision based on a royal shafting by Mr Keating.Too bad,there was no point in throwing good money after bad - Air NZ should have moved on.
Hoodoo,you're right - SQ wanted to help(NZ$1.31/share) and I can assure you that ANZ was very definitely interested - our PC, xenophobic Labour government was not and did enough scaremongering to put the public off.
Perhaps you could work on your facts(and medium-term memory) while you improve on your kiwi metaphors?
Good Luck
Clive(& Hoodoo),the national carrier WAS a financial basket case because of inept management (they were susequently dismissed,presumably under "MD error").
As pointed out, the profit turned by Air NZ compares favourably with that of Qantas given relative size/revenue.Given the recent turn-around,perhaps you could drop the present tense.
YES, Ansett was a poor purchase at the time - plenty written already about due dilligence(sp?). The fact is Ansett,as it was was doomed(see previous post) long before Air NZ turned up,they were just dumb enough to buy it .Bad decision based on a royal shafting by Mr Keating.Too bad,there was no point in throwing good money after bad - Air NZ should have moved on.
Hoodoo,you're right - SQ wanted to help(NZ$1.31/share) and I can assure you that ANZ was very definitely interested - our PC, xenophobic Labour government was not and did enough scaremongering to put the public off.
Perhaps you could work on your facts(and medium-term memory) while you improve on your kiwi metaphors?
Good Luck
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AirNZ are scumbags who destroyed Ansett. They will never be forgiven. THEY had the opportunity to turn things around....but they didn't. Then they go and steal a million dollar Flight Simulator for pilot training the day before AN stops operating, putting it on a freight flight to Auckland.
Australia will never forgive or forget. May Air NZ die a slow, painful death!
Australia will never forgive or forget. May Air NZ die a slow, painful death!
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AN2002,MAAAAAAAAATE,talk about unstable,
You really should seek help
Ansett were well on their way to destroying themselves, ANZ just made an appalling decision to buy when they did.
Take a look at the actions of your own government (esp. the transport minister) during the period - do some research,you may be surprised
You were shafted as much by the regulators/Government and over ambitious unions as by ANZ.
ps:Thanks for the adult sign off. one day we'll get through a thread without a good old oz v Kiwi bash
You really should seek help
Ansett were well on their way to destroying themselves, ANZ just made an appalling decision to buy when they did.
Take a look at the actions of your own government (esp. the transport minister) during the period - do some research,you may be surprised
You were shafted as much by the regulators/Government and over ambitious unions as by ANZ.
ps:Thanks for the adult sign off.
one day we'll get through a thread without a good old oz v Kiwi bash
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Maybe our ozzie counterparts should read the book, the rise and fall.
Do some background research people AIR NZ came in to try save a whale which was beaching itself and in the process make themselves more attractive to SQ and hopefully drag the share price up with it.
If the ozzie lads/ladies should be pissed @ anybody it should be the NZ government who stepped in and stop the sale of the then PRIVITISED AIR NZ to SQ. Because that is what killed Ansett.
Kiwis where also shafted in this deal, remember that.
Do some background research people AIR NZ came in to try save a whale which was beaching itself and in the process make themselves more attractive to SQ and hopefully drag the share price up with it.
If the ozzie lads/ladies should be pissed @ anybody it should be the NZ government who stepped in and stop the sale of the then PRIVITISED AIR NZ to SQ. Because that is what killed Ansett.
Kiwis where also shafted in this deal, remember that.
Evertonian
Well, I've given as good as I've gotten on this very subject, but sadly, the incompetent tools that brought about this very situation that seems to continue to aflict the lives of Kiwis & Aussies alike, are very happily enjoying their lives at our expense. Perhaps they even tune in to Pprune for the occasional titter at the slanging matches across the Tasman.
In the end, it goes back as far as Abeles & Murdoch and sadly continues to this day. I blame a consistant barrage of inept decisions (including bargaining agreements, negotiated by management) that hampered any efforts by those of us at the coal face. ANZ arrived & continued a "fine" tradition of management. Perhaps someone will have learned a lesson over there...
In the end, it goes back as far as Abeles & Murdoch and sadly continues to this day. I blame a consistant barrage of inept decisions (including bargaining agreements, negotiated by management) that hampered any efforts by those of us at the coal face. ANZ arrived & continued a "fine" tradition of management. Perhaps someone will have learned a lesson over there...
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AN2002 - You say "Then they go and steal a million dollar Flight Simulator for pilot training the day before AN stops operating, putting it on a freight flight to Auckland." - Now, while no decent person could but be deeply sympathetic to the plight on the AN employees, and accepting the incompetence of the THEN ANZ management - who were nothing but corporate raiders and "left overs" from the 80's - akin to several high profile Aussie business men/crooks of the day - descending into fantasy and putting about stories such as yours about the "stealing" of a Simulator - does not help anyone. It is, as I a say, a pure fantasy.
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Leaving aside for a moment all the emotion surrounding Ansett.
IF Air NZ MUST have an Australian Domestic Airline to survive, why didn't they put more effort into making Ansett (or at least parts of it) work for them?
Why close the whole thing down?
IF Air NZ MUST have an Australian Domestic Airline to survive, why didn't they put more effort into making Ansett (or at least parts of it) work for them?
Why close the whole thing down?
